T1146 (Schedule 62), Agreement to Transfer Qualified Expenditures Incurred in Respect of SR&ED Contracts Between Persons Not Dealing at Arm’s Length

When the corporation is the transferor, i.e. the entity that transfers an amount of SR&ED qualified expenditures, as indicated on line 010 of the agreement,

Form T1146 will be applicable;
the check box (“yes”) on line 263, Has the corporation entered into an agreement to transfer qualified expenditures incurred in respect of SR&ED contracts?, in Schedule 200 (Jump Code: J) will be selected; and
the total of all SR&ED qualified expenditures shown on line 010 of each applicable copy of Form T1146 where the corporation is designated as the transferor must be allocated and carried over to Form T661 (Jump Code: 661) as follows: line 015 (current expenditures) to line 544 of Form T661 and line 020 (capital expenditures) to line 546 of Form T661.

When the corporation is the transferee, i.e. the corporation that receives an amount of SR&ED qualified expenditures, as indicated on line 010 of the agreement,

Form T1146 will be applicable;
the check box (“yes”) on line 263, Has the corporation entered into an agreement to transfer qualified expenditures incurred in respect of SR&ED contracts?, in Schedule 200 (Jump Code: J) is selected; and
the total of all SR&ED qualified expenditures shown on line 010 of each applicable copy of Form T1146 where the corporation is designated as the transferee must be allocated and carried over to Form T661 as follows: line 015 (current expenditures) to line 508 of Form T661 and line 020 (capital expenditures) to line 510 of Form T661.

Supporting Documents

In support of the authorization to transfer, you have to provide copies of directors’ resolutions either authorizing the agreement or delegating authority to an authorized signing officer. If these documents were not already submitted in a prior year (fields 030 and 035) then they must accompany the T2 Bar Code return. If you are electronically filing the return, then these documents should be sent to the appropriate tax centre and the covering letter should indicate that they are in support of an electronically filed return.